Onex Sees Steady Pipeline for Deals After Busy Second Quarter

Onex Corp., Canada’s largest private equity firm, said it’s acquisition pipeline remains robust after an active second quarter for deals.

“The team remains quite busy,” Bobby Le Blanc, senior managing director at Onex, said on a conference call. “We’re busy, there’s no question about it.”

Since April, Onex and its partners have invested or committed to investing $900 million, of which $280 million is from Onex, the company said in a statement.

Purchases, which totaled $2.6 billion with debt, included the acquisition of the Schumacher Group, the third-largest U.S. provider of outsourced emergency and hospital staffing, for $690 million, and a $415 million investment in the quick-service chain Jack’s Family Restaurants Inc. in July.

In addition to its substantial cash position, Onex said it has roughly $3 billion in uncalled committed capital available from its partners.

On the credit side, Onex said it completed its ninth collateralized loan obligation, raising about $750 million, and established a warehouse on its tenth. The company called its first CLO, which it said generated an 18 percent internal rate of return on Onex’s $36 million investment.

Leblanc said Onex’s credit business now has $6.2 billion in assets under management.

The private equity firm is also said to be exploring the sale or initial public offering of Jeld-Wen Inc., a manufacturer of windows and doors, people familiar with the matter said earlier this month.

Revenues Rise

Onex reported a second-quarter net loss of $289 million for the period ended June 30 compared with a profit of $39 million, or for the same period in 2014. Revenue rose 13 percent to $5.2 billion due to inclusion of revenue from its recently-acquired York Risk Services Group and SIG Combibloc Group, the company said.

There is little correlation between quarters because of the nature of the private equity firm’s business. As a result, investors tend to focus on Onex’s capital per share, which increased 1 percent to $54.72 from the previous quarter and up 4 percent year over year during the quarter.